EXCHANGE ON LONDON.

Wairarapa Daily Times, 20 January 1933, Page 4

EXCHANGE ON LONDON.

What we had feared has come to pass, and the exchange on London has been increased to 25 per cent. We consider the action of the Government is a serious mistake, but are open to conviction. We are in accord with'the views of the “Financial News” (London), one of the authoritative newspapers of the world, which stated that “if the Government decided that the rate ought to be raised in order to help the farmers, they will find themselves faced with many new and difficult problems. . . and, moreover, primary producers would only benefit for a time. Ultimately domestic prices would rise, and, moreover, the increase will be a moral breach of the Ottawa Agreements.” The ITon. W. D. Stewart, Minister of Finance, by his resolute stand, has earned the deep respect of the people of New Zealand from the North Cape to the South. Mr Stewart, through being behind the scenes, was in an excellent position to judge as to the wisdom of the course adopted by the Govern- 1 ment, particularly from the financial point of view of the Dominion. Not only will the raising of the exchange rate have a definitely adverse effect on the budget to the extent of about £3,500,000, but the Government has undertaken to guarantee the banks against loss on . the exchange. This, we venture to predict, will be a very considerable sum of money. The exchange die has been cast, and the people of this Dominion must endeavour to make the best of what appears to us to be a very bad ■ job.